According to the latest information from data and analytics firm GlobalData, U.K. departures to Europe are set to grow at a compound annual growth rate (CAGR) of 2.88 percent from 55.9 million in 2018 to 64.4 million in 2023.
GlobalData’s latest report, Tourism Source Market Insight: United Kingdom, suggests growth is set to continue in spite of the threats posed by Brexit. In particular, Spain and Eastern Europe especially will see continued growth.
In 2018, U.K. residents took 70.7 million international trips and 121.5 million domestic trips. Inbound tourism spending reached $34.2 billion in 2018, while outbound spending totaled $105.1 billion. Domestic tourism expenditure accounted for $137.6 billion in 2018. The report also noted U.K. travelers aged 35 to 49 took 56 million international and domestic trips in 2018, the most of any age bracket.
The Brexit Effect
“Of course Brexit has impacted the U.K.’s outbound tourism industry but the reality is not likely to be as bad as we might have been led to believe, at least in terms of visitor numbers,” said Laura Beaton, travel and tourism analyst at GlobalData. “The depreciation of the pound has had a big impact on expenditure, however, and travelers have had to spend more to match the same experiences they had a few years ago. As a result, cheaper locations are highly sought after by U.K. travelers.”
In May, GlobalData reported outbound visitor numbers from the U.K. to Ireland had “slowly dwindled,” falling from 6.8 percent between 2017 and 2018 to 1.7 percent between 2018 and 2019. The analysts blamed the ongoing negotiations, complete uncertainty and potential outcomes of Brexit on the decline.
Slovakia adopted the Euro in 2009 and Lithuania followed later in 2015, but the Hungarian Forint, Czech Koruna and Romanian Leu remain as national currencies, alleviating conversion concerns between the Euro and the pound. The report found pre-wedding parties from the U.K. are popular in the area, thanks to the low cost of alcohol and accommodations.
“Western Europe is only truly becoming aware of the other offerings of Eastern Europe and this helps to explain how each country has rapidly grown its U.K. visitor numbers in recent years,” said Beaton. “Vilnius in Lithuania is a UNESCO World Heritage site and Budapest has many buildings that have won European Heritage Awards, so Eastern Europe has plenty to entice travelers away from the traditional city breaks of Paris and Rome.”
Spain also is going to continue to experience growth from the U.K. market, according to GlobalData. The Deputy Minister for European Affairs said in case an agreement is not reached between the EU and the U.K., Spain will have a backup plan in place in order to shield the country’s industry.
The report emphasizes, however, that while Spain’s stance is a positive for both tourist businesses and travelers in the two countries, a solution will be needed at an EU-level.
“Tourism from the U.K. is an important part of many European countries’ economies and Spain, France, and Italy are going to remain the top destinations for U.K. travelers for the foreseeable future—so it is important that ties are not severed,” said Beaton.